Role of HR Becoming More Strategic, New Report Shows

ALEXANDRIA, Va., — Human resources is increasing its strategic role in business with HR leaders more often part of an organization’s board or executive team, a new report found.

The report,
Human Resource Management Policies and Practices in the United States, was released by the Cranfield Network on International Human Resource Management (CRANET) in collaboration with the Society for Human Resource Management (SHRM) and the Center for International HR Studies in the School of Labor Employment Relations at The Pennsylvania State University (CIHRS).

The CRANET/ SHRM/CIHRS 2014/15 report outlines the results of a survey of almost 700 senior-level HR practitioners, both SHRM and non-SHRM members, in organizations with 200 or more employees.

The results detail key practices in HR management and the role of the HR department, including:

Leadership

• 70 percent of responding organizations said HR has a place on the board of directors. That compares to 63 percent in 2009 and 41 percent in 2004.

• Responses indicated that HR appears to be moving away from working jointly with line management and taking sole responsibility for major policy decisions such as setting pay and benefits.

Talent Management

• The vast majority of organizations reported having a formal performance review system (96 percent for management, 95 percent for professional staff, and 93 percent for clerical/manual staff).

• Performance appraisals are predominantly used for pay/salary decisions (76 percent). But, because performance reviews frequently require the input of employees themselves, they are equally likely to be used for decision-making on career moves (75 percent) and identifying opportunities for training and development (74 percent).

• Outsourcing is most frequently used for pensions and benefits, the accounting aspects of HR management. Twenty-six percent of respondents said their organizations completely outsourced pensions, and 14 percent said benefits administration was completely outsourced.

The survey also showed:

• A trend toward less frequent use of part-time working arrangements and more frequent use of teleworking.

• 60 percent of responding organizations spent less than 5 percent of annual payroll costs on training. Yet the mean number of training days increased since 2004, which might be explained by a greater investment in e-learning.

Founded in 1948, the Society for Human Resource Management (SHRM) is the world’s largest HR membership organization devoted to human resource management. Representing more than 275,000 members in over 160 countries, the Society is the leading provider of resources to serve the needs of HR professionals and advance the professional practice of human resource management. SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China, India and United Arab Emirates. Visit SHRM Online at shrm.org and follow us on Twitter @SHRMPress.